Country Reports on Terrorism 2010 - Paraguay

United States Department of State, Country Reports on Terrorism 2010 - Paraguay, 18 August 2011, available at: http://www.refworld.org/docid/4e52481a2c.html [accessed 2 August 2015]

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Overview: Increased activity by an internal insurgent group and the resulting public demands for action brought terrorism to the policy forefront. President Fernando Lugo responded to threats by mobilizing the military in April and passing terrorism legislation in June. Though Paraguay enhanced its counterterrorism efforts, it remained hampered by ineffective immigration, customs, and law enforcement controls along its porous borders, particularly the Tri-Border Area (TBA) with Argentina and Brazil. The June arrest of alleged Hizballah financier Moussa Ali Hamdan in Ciudad del Este, Paraguay, demonstrated the area's permissive environment for terrorist financing activity. Limited resources, sporadic interagency cooperation, and corruption within customs, the police, the public ministry, and the judicial sector, impeded the government's law enforcement initiatives throughout the country.

Since 2008, the leftist Paraguayan People's Army (EPP) has been active in the northern departments of Paraguay, abutting the Brazilian border. Membership statistics for the EPP are difficult to establish, but it is believed to be a small, decentralized group operating mainly in Concepcion Department. The Paraguayan government classified the EPP as an internal terrorist organization based on several kidnappings and multiple shootouts with the police and military. The EPP claimed responsibility for a 2009 explosion and a December 2010 bomb threat, both at the Palace of Justice, though neither claim was verified.

Legislation and Law Enforcement: On June 23, President Fernando Lugo signed a new terrorism bill into law that defines and criminalizes terrorist activities and aids governmental counterterrorism efforts, particularly in relation to terrorism financing, when paired with Paraguay's 2009 anti-money laundering law. The law established sentencing guidelines from five to 30 years for terrorism-based crimes.

In May, five U.S. Border Patrol and Customs and Border Protection (CBP) Officers conducted an assessment of Paraguay's porous eastern border with Brazil and Argentina. Based on its assessment, the CBP and Border Patrol conducted a three-week training session in September to assist Paraguayan Customs Officials and Police in better confronting smuggling and related crimes in areas known as sources of terrorist financing.

Countering Terrorist Finance: The new counterterrorism law includes a terrorist financing provision stipulating prison sentences of five to 15 years for financial assistance, interaction, or connection with terrorist organizations and/or individuals. Paired with 2009's anti-money laundering law, the new legislation provides Paraguay's Secretariat for the Prevention of Money Laundering (SEPRELAD) better tracking, reporting, and enforcement powers.

Paraguay is a member of the Financial Action Task Force (FATF) against Money Laundering in South America (GAFISUD). Paraguay assumed GAFISUD's rotating Presidency in December 2010. As a member of the Egmont Group, SEPRELAD exchanges information with other members of the Egmont Group, including the United States.

Paraguayan law does not provide for freezing or seizure of many criminally derived assets. Authorities can only freeze assets of persons under investigation for a crime in which the state risks loss of revenue from furtherance of a criminal act, such as tax evasion. In December, SEPRELAD's Minister submitted a draft bill to the Presidency that requests SEPRELAD be given administrative power to freeze suspected money laundering and terrorism-related assets.

Regional and International Cooperation: In March, Paraguay signed an agreement with Colombia to fight terrorism and organized crime. Paraguay's strongest regional partner in counterterrorism and law enforcement activities was Brazil. In October, Brazilian and Paraguayan ministers met in Asuncion and announced a plan to coordinate activities along the border to counter arms and narcotics trafficking, though no agreement has been signed.

Paraguay signed the Beijing Convention on the Suppression of Unlawful Acts Relating to International Civil Aviation and the Beijing Protocol to the Convention for the Suppression of Unlawful Seizure of Aircraft at the conclusion of an International Civil Aviation Organization diplomatic conference in September.